The wage share is very much present in the political debate as a measure of how the “benefits of growth” are fairly distributed between labor and capital. The decent level and growth of wages represent the concept of economic justice or fairness for household because almost two-thirds of their income is sourced from the labor market. This implies that wage is precarious, especially if someone loses a job, whereas property rights ensure that rents and other form of capital incomes have greater security.

The common conjectures that increasing to higher wages could lead to market distortion and reversely affect economic performance seems to be an unspell curse to the Malaysian economy. These assumptions are strongly held by the majority of employers as a result of the lack of evidence-based facts and scientific evaluation. In collaboration with the Ministry of Finance, this study provides exposure regarding the need to increase wage rates and attainable benefits from such increases to employers, employees and the entire population. Some recommended approaches that can be used to increase wages without impacting economic competitiveness, are provided.